Irrigation key to spike in cow numbers

INCREASE: Dairy cattle numbers have more than doubled in South Canterbury in the last 10 years.

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South Canterbury has more than doubled its dairy cattle numbers in just 10 years.

Agricultural census results show the number of dairy cattle in the region rose from 122,278 in the 2002/03 census to 299,604 in the 2012/13 census.

Federated Farmers South Canterbury dairy chairman Ryan O'Sullivan said the dramatic rise of conversion from sheep and beef farms and arable crop farms was due to the profitability of the dairy sector.

"The majority of those farms that had suitability for containing milking cows with either good rainfall or irrigation, have made the conversion to dairy," he said.

However, O'Sullivan said the number converting would dry up until a new irrigation scheme was put through.

He believed that in the meantime South Canterbury had plateaued in the number of dairy farms.

"We have run out of irrigated properties," he said.

A report by DairyNZ using the agricultural census figures showed South Canterbury only had 4.6 per cent of the dairy cows in New Zealand.

However, those cows produced the highest average litres of milk per cow per day - 20.17 litres.

"As a region there are a number of things that set us apart ... the irrigation ensuring consistently irrigated pastures is at the top," he said.

O'Sullivan noted recent droughts in Waikato had greatly affected its output and statistics. The South Canterbury region had the second highest average herd size in the country with 786, well above the national average of 402 cows.

Federated Farmers South Canterbury president Ivon Hurst said it was not a dairy boom in the region, rather a trend.

"I stay clear of emotive words like boom. Obviously there is a move to more dairy cows because of profitability," he said.

Hurst said the statistics showed the number of dairy cows in New Zealand was greater than the population for the first time.

And with that he spotted a challenge.

Farmers needed to be aware the farm-gate prices they had received for milk solids in the past year were extremely high and not likely to be seen again for a long time, he said.

"As an industry we need to be focusing on debt reduction."

Hurst said 40 per cent of debt in dairy was held by 20 per cent of farmers.

Although that kind of figure is reflected across all businesses, as a sector, dairy needs to be working on reducing that to ensure the industry's stability in New Zealand.

The number of dairy sheds being built in South Canterbury has been steady in recent years, with no evidence of a boom.

Timaru District Council building control manager Grant Hyde said there had been four consents for milking sheds so far this year.

It did not provide a direct correlation to the number of conversions as it may be a secondary shed on an already operational dairy farm, he said.

There were eight new sheds in 2013, seven in 2012, two in 2011, one in 2010 and four in 2009.

Waimate District Council's building and regulatory services Sue Kelly said the council had issued seven consents for milking sheds in the past year, four during the 2012/13 financial year, and six each in the two years prior.

Mackenzie District Council building control manager Steve McLellan said the district was an anomaly.

"It's one of the few places it's [dairy conversion] not happening," he said.

McLellan said there was so little dairying in the district, Fonterra's GlobalDairyTrade (GDT) auction price fall would not have a direct impact on the district.

"We have had one calf-rearing shed conversion go through this year. Conversion just doesn't happen in this area."